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Enefit Green's unaudited financial results Q4 and 12 months of 2023

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Enefit Green's unaudited financial results Q4 and 12 months of 2023

Enefit Green's consolidated operating income for Q4 2023 decreased by 19 percent
to EUR66.9m compared to the same time last year, and operating expenses (excluding
depreciation)  increased by  1 percent to  37.3 million euros.  As a  result, Q4
2023 EBITDA  fell by 35 per cent to EUR29.6m. In the last quarter of the year, the
Group  earned a net profit of EUR19.1m, which  is 46 percent less than in the same
period last year.

In  2023 as a whole,  Enefit Green's consolidated  operating income decreased by
10 percent  compared to  the previous  year to  EUR230.1m, EBITDA by 32 percent to
EUR105.9m,  and net  profit by  49 percent to  EUR55.8m. 2023 earnings per share was
EUR0.21 (2022: EUR 0.42).

The  Management  Board  of  Enefit  Green,  in coordination with the Supervisory
Board, proposes to pay the shareholders EUR27.7m or EUR0.105 per share in dividends.

Aavo Kärmas, Chairman of the Management Board of Enefit Green, comments:

"Enefit Green continued to work on development projects in 2023 and we completed
two  new renewable power plants in  Estonia and one in Poland.  As of the end of
the  year,  the  company  had  more  than  500 megawatts of operating production
capacity and more than 700 megawatts under construction.

We  made investment decisions for  the construction of one  onshore wind farm in
Lithuania  and the construction of three solar  farms in Estonia and Latvia. The
total capacity of these investments is approximately 180 megawatts and the total
investment will exceed 200 million euros.

In 2023, we produced 1.3 terawatt-hours of electricity and 604 gigawatt-hours of
thermal  energy. 20% growth in  electricity production result  was driven by the
increase  in the output of new completed wind and solar farms and of those still
under  construction. Although the  new wind and  solar farms added a significant
part  of the  year's electricity  production, it  turned out  to be smaller than
planned,  primarily due to the low wind speed, the Akmen? incident and the lower
availability of the Shilut? wind farm.

Lower  than planned  production led  to an  increase in  the cost  of purchasing
electricity  to  fulfil  the  obligations  related  to the long-term electricity
contracts  (PPAs). To  reduce the  power price  risk, large proportion of Enefit
Green's electricity production has been sold forward with long-term PPAs. As the
actual  production was  well below  the planned  level, the  shortfall had to be
purchased on the market to meet contractual obligations.

We  will continue to work this year to ensure the completion of our construction
projects  and that every  megawatt-hour of electricity  will be produced. Enefit
Green  has a  strong development  portfolio of  approximately 4,900 megawatts of
short-  and long-term  on- and  offshore wind  and solar  farm projects. We have
long-term  development and  operating experience  and a  good access  to capital
markets.  However, the speed of the company's growth is determined by the demand
on  our core markets and of our customers,  as well as our promise to manage the
assets of our shareholders well."

Webinar to present the results

Enefit Green is organising a webinar in English for investors today, 29 February
at 13:00 (EET) to present the unaudited 2023 results. To participate, please use
this link (https://teams.microsoft.com/l/meetup-
join/19%3ameeting_YzU4YTJhZDgtMDVlNi00NjFkLWIxYzYtNWVmNGY3MzlhMTll%40thread.v2/0
?context=%7B%22Tid%22%3A%2215cd778b-2b28-4ebc-956c-
b5977a36cd28%22%2C%22Oid%22%3A%22775ae01b-e561-
4cc9-8790-1290c7b28035%22%2C%22IsBroadcastMeeting%22%3Atrue%2C%22role%22%3A%22a%
22%7D&btype=a&role=a).

Highlights in 2023

  * 65 MW of new wind and solar parks completed
  * Suspension and restart of the construction of the Akmene wind farm
  * One final investment decision to build a wind farm - 87 MW
  * Three final investment decisions to build a new solar farm - a total of 91
    MW
  * Total value of 2023 final investment decisions exceeds EUR200m
  * A total of EUR505m of loan facilities signed during 2023
  * In Q4, we signed contracts for the sale of all biomass assets

Key indicators

+------------------------+-------+-------+--------+-+--------+--------+--------+
|                        |Q4 2023|Q4 2022|Change %| |12m 2023|12m 2022|Change %|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|PRODUCTION AND SALES    |       |       |        | |        |        |        |
|VOLUMES                 |       |       |        | |        |        |        |
+------------------------+-------+-------+--------+-+--------+--------+--------+
|Electricity production, |       |       |        | |        |        |        |
|GWh                     |    413|    291|     42%| |   1 343|   1 118|     20%|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|Incl. new wind and solar|       |       |        | |        |        |        |
|farms                   |    112|      0|       -| |     259|       0|       -|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|Sales of electricity,   |       |       |        | |        |        |        |
|GWh                     |    520|    340|     53%| |   1 736|   1 217|     43%|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|Heat production, GWh    |    172|    157|     10%| |     604|     566|      7%|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|Pellet production,      |       |       |        | |        |        |        |
|thousand t              |     42|     42|      0%| |     156|     154|      1%|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|Pellet sales, thousand t|     43|     47|     -9%| |     134|     149|    -10%|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|                        |       |       |        | |        |        |        |
+------------------------+-------+-------+--------+-+--------+--------+--------+
|OPERATING INCOME, mEUR    |   66.9|   82.8|    -19%| |   230.1|   257.0|    -10%|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|Sales revenue, mEUR       |   61.2|   76.4|    -20%| |   205.8|   233.3|    -12%|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|Support for renewable   |       |       |        | |        |        |        |
|energy and other        |       |       |        | |        |        |        |
|business income, mEUR     |    5.7|    6.4|    -10%| |    24.3|    23.7|      2%|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|OPERATING EXPENSES*, mEUR |   37.3|   36.9|      1%| |   124.2|   102.2|     22%|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|EBITDA, mEUR              |   29.6|   45.8|    -35%| |   105.9|   154.8|    -32%|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|NET PROFIT, mEUR          |   19.1|   35.4|    -46%| |    55.8|   110.2|    -49%|
+------------------------+-------+-------+--------+-+--------+--------+--------+
|EPS, EUR                  |   0.07|   0.13|    -46%| |    0.21|    0.42|    -49%|
+------------------------+-------+-------+--------+-+--------+--------+--------+

* excluding D&A

Operating income

The  Group's electricity  production increased  to 1,343 gigawatt-hours in 2023
(+20%  compared to the reference period). The  growth was driven by the wind and
solar farms completed last year and by those still under construction.

Total  operating income decreased by EUR27.0m, the figure reflecting a decrease in
revenue  of  EUR27.5m  and  an  increase  in  renewable  energy  support and other
operating   income  of  EUR0.6m.  Of  the  EUR27.5m  revenue  decrease,  EUR24.4m  was
attributable  to electricity sales, which were strongly influenced by the market
price of electricity.

In  2023, the average  electricity price  in the  group's core markets was 92.7
EUR/MWh  (2022: 205.5 EUR/MWh) and the  group's average implied captured electricity
price was 89.6 EUR/MWh (2022: 149.5 EUR/MWh).

The  implied captured electricity price differs from the average market price in
the  group's core markets,  because it takes  into account long-term fixed-price
power  purchase  agreements  (PPAs),  renewable  energy  support,  purchases  of
balancing  energy,  electricity  purchases  from  the  Nord  Pool  day-ahead and
intraday markets, and the fact that wind farms do not produce the same amount of
electricity every hour.

The  group's average price of  electricity sold to the  market in 2023 was 73.0
EUR/MWh  compared with 165.7 EUR/MWh in 2022. The  group sold 783 GWh of electricity
to  the market  in 2023 compared  with 786 GWh  in 2022. In 2023, 953 GWh of the
group's  portfolio was covered by PPAs at an average price of 86.9 EUR/MWh. A year
earlier, 432 GWh of electricity was sold under an income model based on PPAs and
the feed-in tariff (FiT) at an average price of 90.8 EUR/MWh.

Various  factors like  the incident-induced  long stoppage  of Akmene wind farm,
lower  than average wind speeds and  lower than forecasted availabilities caused
lower  than  expected  electricity  production,  which  in  turn  contributed to
increased  cost  of  purchasing  electricity,  because to fulfil the obligations
under  the PPAs, we had to cover the resulting production deficit with purchases
from the market. In 2023, we purchased 411 GWh of electricity from the market at
an  average price of 110.2 EUR/MWh,  compared with 115 GWh at  an average price of
229.2 EUR/MWh  in 2022 (the prices  and volumes exclude  the electricity purchased
for  pellet production). In  2022, the amount of  electricity purchased from the
market  was significantly  lower as  part of  the production  was covered by the
fixed-price  FiT  support  scheme  and  the  volumes agreed under PPAs were very
small.

Pellet  sales revenue  grew by  EUR1.7m compared  to the  previous year. While the
average sales price of pellets increased by 17% to 238.6 EUR/t in 2023, the pellet
sales volume decreased by 10% to 134 k tonnes.

Heat  production grew by  38 GWh to 604 GWh  (2022: 566 GWh) and  the heat price
increased  by 11% (+1.7 EUR/MWh). Through the combined effect of higher production
and a higher price, heat sales revenue grew by EUR1.4m.

Other  operating income  grew by  EUR0.6m to  EUR24.3 million  (2022: EUR23.7m). Other
operating  income was also supported by liquidated damages of EUR1.0m received for
the  low availability of the Shilute wind farm and a gain of EUR1.0m on the sale of
the Broc?ni cogeneration (CHP) plant and the pellet factory.

Operating expenses

Operating  expenses  excluding  depreciation  increased  by 22 million or 22% to
124.2 million euros last year.

Expenses  on raw materials, consumables and  services increased by EUR14.4m (17%).
The  biggest changes  were in  electricity costs,  which grew  by EUR15.7m  due an
increase  in balancing energy costs (up EUR1.7m  due to production growth) and the
cost  of electricity purchased to service  the PPA portfolio (up EUR16.8m compared
to 2022).

Technological  fuel costs grew by  EUR3.8m, driven by an  increase in the price of
wood  chips.  Repair  and  maintenance  costs  increased  by  EUR2.5m  due  to the
indexation  of  full-service  maintenance  contracts  and additional planned and
unplanned maintenance of wind farms.

Expenses  on materials, supplies and spare  parts decreased by EUR7.5. Expenses on
materials,  supplies and spare  parts were higher  in 2022 due to  a increase in
solar  services. Due to its  low profit margin, however,  we decided to exit the
solar  services business  in mid-2022 in  order to  focus on our more profitable
core business and sold related inventories.

The  group's payroll expenses grew by 1.7m (19%) compared to 2022, mainly due to
an  increase in the number  of full-time equivalent staff  from 183 to 194 and a
general  pay rise.  The sale  of the  Broc?ni CHP  plant and the pellet factory,
which  was finalised on 29 December 2023, reduced the group's headcount by 40 to
154 by the end of 2023.

Other  operating expenses  increased by  EUR4.8m, driven  by growth  in consulting
expenses  (EUR2.9m),  IT  expenses  (EUR0.3m)  and  insurance  expenses (EUR0.2m). The
biggest  items within  consulting expenses  were the  compensation paid to Eesti
Energia  AS  for  development  expenses  incurred in connection with development
projects  (EUR0.7m)  and  consulting  expenses  related to wind energy development
projects  (EUR0.8m), solar energy development projects (EUR0.4m) and the sale of the
CHP plants and the pellet factory (EUR0.4m).

EBITDA and segment reporting

2023 EBITDA  of the Group decreased by  EUR 48.9 million to EUR 105.9 million (-
32%).

The  factor with  the strongest  impact on  EBITDA development  was the price of
electricity sold, which fell steeply compared to 2022 (negative impact: EUR77.6m).
Due  to  PPAs,  the  volume  of  electricity purchase to balance the electricity
portfolio grew significantly (negative impact: EUR33.4m), which also increased the
volume  of electricity sold (positive impact: EUR49.3m).The combined effect of the
above  factors on EBITDA development is influenced  by the volume and profile of
electricity produced during the period.

The  increase  in  fixed  costs  by  EUR8.6m  also played an important role in the
decrease of EBITDA. The increase in fixed costs was driven by maintenance costs,
research and consulting expenses and payroll expenses, as explained above.

In terms of operating income and EBITDA for 2023, the Group's largest segment is
Wind  energy, which accounted for 59% of operating income and 71% of EBITDA. The
Cogeneration  segment contributed 37% of operating income and 35% of EBITDA. The
smallest reportable segment is Solar energy, which accounted for 4% of operating
income  and 3% of EBITDA. In  absolute terms, the EBITDA  of the Wind energy and
the  Cogeneration segments  decreased the  most as  those segments  were hit the
hardest by the fall in the market price of electricity sold.

Depreciation, amortisation and impairment (D&A)

D&A  expense  grew  by  EUR2.8m  to  EUR40.6m  in  2023 (2022: EUR37.8m). Major assets
completed  and recognised during  the period included  the Purtse wind and solar
farm  and a  solar power  plant built  for the  Estonia mine  in Estonia and the
Zambrów  solar farm in Poland. Recognition of the Purtse wind and solar farm and
the  Zambrów solar farm increased D&A  expense by EUR0.9m and EUR0.1m, respectively.
D&A  expense for  2022 was reduced  by EUR1.4m  by the  reversal of the impairment
losses recognised for the Aulepa and the Shilale wind farms.

Net finance income

Net finance income increased by EUR2.1m year on year. Interest expense on bank
loans grew by EUR9.5m to EUR12.9m but 94% of it was capitalised due to the wind
farms still being under construction. The change in the exchange rate of the
Polish zloty had a positive impact (2023: a gain of EUR0.5m, 2022: a loss of
EUR0.5m).

Net profit

In addition to the factors explained above, net profit was additionally affected
by the increase in income tax expense by EUR4.1m to EUR9.7m due to the higher income
tax  expense in Estonia related to the payment of larger dividends last year. As
a result, 2023 net profit of the Group was EUR55.8m, which was EUR54.4m or 49% lower
than in 2022.

Investments

The Group invested EUR355.7m in 2023, which is EUR162.2m more than in 2022.

Growth  resulted  from  development  investments,  which extended to EUR350.6m. Of
this,  EUR262.5m was invested in the construction  of three wind farms: EUR127.5m in
the  Kelm? wind  farms, EUR84.1m  in the  Sopi-Tootsi wind  farm and EUR51.8m in the
Tolpanvaara  wind farm.  Investments made  in the  Kelm? wind farms consisted of
investments of EUR89.5m in the Kelm? I wind farm, EUR27.9m in the Kelm? II wind farm
and EUR10.2m in the Kelme III wind farm.

The  largest investments in the development of  solar energy were EUR12.7m for the
Purtse solar farm and EUR9.4m for the Vändra solar farm.

Base  investments amounted to EUR5.1m (2022: EUR5.4m) and were mainly related to the
Estonian wind farms (EUR2.5m) and the Iru power plant (EUR1.3m).

Financing

Enefit  Green finances its operations with  equity and debt capital. In 2023, we
continued  to optimise our capital structure by raising debt by securing new and
drawing  down  previously  secured  loans  to  finance  our  ongoing  investment
programme for wind and solar farms.

During  the year, we signed new loan agreements for EUR505m. In January, we signed
a  12-year loan  agreement for  EUR100m with  NIB and  a 7-year loan agreement for
EUR225m  with SEB. In September, we signed a 12-year loan agreement for EUR180m with
EIB.

As of 31 December 2023, we had EUR285m of undrawn investment loans.

In  addition to investment loans, Enefit Green has signed three revolving credit
facility  agreements  of  EUR50m  in  total,  which  mature between 2024-2026 (all
facilities were undrawn as of 31 December 2023).

As  of  31 December  2023, the  amortised  cost  of the group's interest-bearing
liabilities  was EUR482.4m (31 December  2022: EUR279.6m). The figure comprises bank
loans and finance lease liabilities of EUR472.6m and EUR9.8m, respectively.

The  weighted average interest rate  of bank loans drawn  down as at 31 December
2023 was 3.75% (31 December 2022: 2.60%). The base rates at the end of 2023 were
significantly  higher than a year earlier.  During the year, the 3-month EURIBOR
increased  by 1.78 percentage points to  3.91% and the 6-month EURIBOR increased
by  1.17 percentage points to 3.86%. As  of 31 December 2023, 33.3% of the loans
drawn down by Enefit Green were hedged with interest rate swaps.

Dividend proposal

In coordination with the supervisory board, the management board proposes that
in 2024 the company pay the shareholders a dividend of EUR27.7m (EUR0.105 per share)
from retained earnings, which is equivalent to 49.7% of the group's unaudited
net profit for 2023.

Condensed consolidated interim income statement

 EUR thousand                               Q4 2023  Q4 2022        2023     2022

 Revenue                                   61,157   76,380     205,757  233,280
-------------------------------------------------------------------------------
 Renewable energy support and other
 income                                     5,745    6,372      24,307   23,735
-------------------------------------------------------------------------------
 Change in inventories of finished goods
 and work-in-progress                     (1,056)  (1,304)       2,210    3,303
-------------------------------------------------------------------------------
 Raw materials, consumables and services
 used                                    (28,944) (30,486)   (100,330) (85,954)
-------------------------------------------------------------------------------
 Payroll expenses                         (2,782)  (2,470)    (10,807)  (9,111)
-------------------------------------------------------------------------------
 Depreciation, amortisation and
 impairment                              (10,819)  (8,848)    (40,559) (37,777)
-------------------------------------------------------------------------------
 Other operating expenses                 (4,520)  (2,688)    (15,237) (10,411)
-------------------------------------------------------------------------------
 OPERATING PROFIT                          18,781   36,956      65,341  117,065
-------------------------------------------------------------------------------
 Finance income                             1,134      240       1,960      337
-------------------------------------------------------------------------------
 Finance costs                            (1,481)  (1,688)     (1,858)  (2,342)
-------------------------------------------------------------------------------
 Net finance costs                          (347)  (1,448)         102  (2,005)
-------------------------------------------------------------------------------
 Profit (loss) from associates under the
 equity method                               (20)       27          66      714
-------------------------------------------------------------------------------
 PROFIT BEFORE TAX                         18,414   35,535      65,509  115,774
-------------------------------------------------------------------------------
 Corporate Income Tax Expense                 690    (126)     (9,716)  (5,567)
-------------------------------------------------------------------------------
 PROFIT FOR THE PERIOD                     19,104   35,409      55,793  110,207
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
 Basic and diluted earnings per share
-------------------------------------------------------------------------------
 Weighted average number of shares,
 thousand                                 264,276  264,276     264,276  264,276
-------------------------------------------------------------------------------
 Basic earnings per share, EUR                0.072     0.13        0.21     0.42
-------------------------------------------------------------------------------
 Diluted earnings per share, EUR              0.072     0.13        0.21     0.42
-------------------------------------------------------------------------------

Condensed consolidated interim statement of financial position

  EUR thousand                                    31 Dec 2023   31 Dec 2022

  ASSETS
--------------------------------------------------------------------------
  Non-current assets
--------------------------------------------------------------------------
  Property, plant and equipment                   1,027,057       776,870
--------------------------------------------------------------------------
  Intangible assets                                  59,891        60,382
--------------------------------------------------------------------------
  Right-of-use assets                                 9,097         4,239
--------------------------------------------------------------------------
  Prepayments                                        55,148        19,412
--------------------------------------------------------------------------
  Deferred tax assets                                 2,013         1,321
--------------------------------------------------------------------------
  Investments in associates                             548           506
--------------------------------------------------------------------------
  Derivative financial instruments                    5,054        11 277
--------------------------------------------------------------------------
  Long-term receivables                                                40
--------------------------------------------------------------------------
  Total non-current assets                        1,158,808       874,047
--------------------------------------------------------------------------

--------------------------------------------------------------------------
  Current assets
--------------------------------------------------------------------------
  Inventories                                         3,180        14,227
--------------------------------------------------------------------------
  Assets of a company held for sale                  15,370
--------------------------------------------------------------------------
  Trade and other receivables and prepayments        55,082        41,091
--------------------------------------------------------------------------
  Cash and cash equivalents                          65,677       131,456
--------------------------------------------------------------------------
  Derivative financial instruments                    3,806         3,349
--------------------------------------------------------------------------
  Total current assets                              143,115       190,123
--------------------------------------------------------------------------
  Total assets                                    1,301,923     1,064,170
--------------------------------------------------------------------------


 EUR thousand                                             31 Dec 2023 31 Dec 2022

 EQUITY
-------------------------------------------------------------------------------
 Equity and reserves attributable to equity holder of
 the parent
-------------------------------------------------------------------------------
 Share capital                                              264,276     264,276
-------------------------------------------------------------------------------
 Share premium                                               60,351      60,351
-------------------------------------------------------------------------------
 Statutory reserve capital                                    5,556       3,259
-------------------------------------------------------------------------------
 Other reserves                                             163,451     166,419
-------------------------------------------------------------------------------
 Foreign currency translation reserve                         (162)       (762)
-------------------------------------------------------------------------------
 Retained earnings                                          223,718     225,190
-------------------------------------------------------------------------------
 Total equity                                               717,190     718,733
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
 LIABILITIES
-------------------------------------------------------------------------------
 Non-current liabilities
-------------------------------------------------------------------------------
 Borrowings                                                 454,272     255,755
-------------------------------------------------------------------------------
 Goverment grants                                             3,102       7,115
-------------------------------------------------------------------------------
 Non-derivative contract liability                           12,412      18,086
-------------------------------------------------------------------------------
 Deferred tax liabilities                                    12,497      12,326
-------------------------------------------------------------------------------
 Other non-current liabilities                                5,239       3,000
-------------------------------------------------------------------------------
 Provisions                                                       8           9
-------------------------------------------------------------------------------
 Total non-current liabilities                              487,530     296,291
-------------------------------------------------------------------------------
 Current liabilities
-------------------------------------------------------------------------------
 Borrowings                                                  28,159      23,808
-------------------------------------------------------------------------------
 Trade and other payables                                    58,412      20,215
-------------------------------------------------------------------------------
 Liabilities of a company held for sale                       4,952           0
-------------------------------------------------------------------------------
 Provisions                                                       6           2
-------------------------------------------------------------------------------
 Non-derivative contract liability                            5,674       5,121
-------------------------------------------------------------------------------
 Total current liabilities                                   97,203      49,146
-------------------------------------------------------------------------------
 Total liabilities                                          584,733     345,437
-------------------------------------------------------------------------------
 Total equity and liabilities                             1,301,923   1,064,170
-------------------------------------------------------------------------------


Additional information:
Sven Kunsing
Head of Financial Communication
investor@enefitgreen.ee
(https://www.globenewswire.com/Tracker?data=eahglFI0K4UUxwsmqXkQdO3N_ld1uojlGTE_
vteiKcyQu1wfu3r9tXxEfe64TI9iPjXXdLcA-1wKJKK402r4cwPqdjBXLG-Ga36PZFEEUJ4=)
https://enefitgreen.ee/investorile/
(https://www.globenewswire.com/Tracker?data=2hvtWZj2Sah7P5FHBmegLeIoMx1_pu7PK9v_
TsWBkf-qdy705TQpwpl_2cNDmb3iCN-
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